Navigate changing consumer behavior with service fees
While the pandemic spurred a seismic shift toward digital interactions, post-pandemic consumers still want a mix of in-person and digital options– and they expect organizations to provide them. Predicting future consumer behavior based on past behavior is limiting, and you may overlook the unique motivations that drive consumers to specific payment technologies. More than ever, consumers want to know that you are meeting them where they live and work–in the digital world, the real world, and a combination of both.
According to a recent study by Accenture, 60% of consumers say their priorities keep changing because of world events.1 Social responsibility plays a role, too. 66% of consumers say their personal needs drive decision-making, but 72% also feel they can personally impact the world and their communities through behaviors and buying choices.2 The upshot? The majority of consumers feel that their changing needs are important, but they are also community-minded. As a result, agencies should realize their constituents make payment decisions based on a complex set of factors that consistently evolve.
People make daily calculated decisions about how and when to pay bills. Utilities like heat, electricity, and water are among those they prioritize. During the pandemic, a McKinsey study found people ranked paying utility bills second most important after housing, and 85% paid their bill in full in the previous month. 71% of consumers who planned to use COVID-19 stimulus checks to pay bills chose to pay for utilities.3 Because utilities are vital, U.S. consumers are willing to pay service fees to access disbursements like stimulus checks faster. In 2021, citizens received nearly three times as many disbursements via expedited instant payment than in 2020 because they wanted the money quicker.4 When given the option to pay for added flexibility and greater control so they can evaluate the best way to fulfill their needs, constituents increasingly take that opportunity.
A majority of consumers will pay to get things done faster–and understand service fees as a convenience cost, not a penalty. A PYMNTS.com study notes that 79% of consumers say service fees on transactions don’t negatively impact their opinion of the business, and 85% pay service fees without issue.5 Agency outreach and education can help consumers see how service fees help conserve costs so the agency can invest more in the community good – fulfilling the growing consumer desire to make a positive impact on the world.
Some customers may demand more digital payment options. Others may value human interaction, especially post-pandemic. Some customers gladly pay service fees for online payment options–others want to pay in person to avoid fees. And some may change the way they pay their bills month by month depending on their unique situation at the time. Sound confusing? What they want is flexibility–and an organization that can adapt to changing needs. A holistic payment partner with service fee capabilities can help you pay for solutions that fulfill evolving constituent needs. The savings you realize from a service fee program can help you meet current demand and grow towards long term stability no matter how citizens decide they want to pay their bills, even if that changes every month.
We are a partner who understands the complexities of evolving consumer behavior, and we monitor both markets and mindsets to understand what life forces may affect your payment mix. And we work with you to find agile, responsive solutions that boost your agency's resilience and strengthen its customer relationships. Contact us to learn more about how we can help you get started.